Legal Document View

Unlock Advanced Research with PRISMAI

- Know your Kanoon - Doc Gen Hub - Counter Argument - Case Predict AI - Talk with IK Doc - ...
Upgrade to Premium
[Cites 9, Cited by 0]

Custom, Excise & Service Tax Tribunal

Nikon India Pvt Ltd vs New Delhi on 6 April, 2026

     CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
                                    NEW DELHI
                           PRINCIPAL BENCH - COURT NO. I

                    CUSTOMS APPEAL NO. 52552 OF 2019

(Arising out of Order-in-Appeal No. CC (A)/CUS/D-I/Import/NCH/255/2019-20 dated
14.06.2019 passed by the Commissioner of Customs (Appeals), New Customs House,
Near I.G.I. Airport, New Delhi)

Nikon India Private Ltd.                                      .....Appellant
Plot No. 71, Sector-32, Institutional Area,
Gurgaon - 122001, Haryana

                                          VERSUS


Commissioner of Customs (Import),                              .....Respondent
New Customs House, Near I.G.I. Airport,
New Delhi - 110037

APPEARANCE:

Shri V. Lakshmikumaran, Ms. Anjali Gupta and Shri Ashwani Bhatia, Advocates
for Appellant
Shri P.R.V. Ramanan, Special Counsel and Shri Rakesh Kumar, Authorized
Representative appearing for the Department

CORAM:
HON'BLE MR. JUSTICE DILIP GUPTA, PRESIDENT
HON'BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)


                                                   Date of Hearing: 18.11.2025
                                                   Date of Decision: 06.04.2026

                          FINAL ORDER NO. 50671/2026

BY THE BENCH:

        Nikon India Private Ltd.1 has filed this appeal to assail the order

dated 14.06.2019 passed by the Commissioner of Customs (Appeals), New

Customs House, Near I.G.I. Airport, New Delhi2, by which the application

filed by it for refund of duty said to have been paid under protest on the

52 Bills of Entry that were filed during the period from 05.01.2015 to

27.02.2015 has been rejected.




1.     the appellant
2.     the Commissioner (Appeals)
                                        2
                                                                     C/52552/2019

2.    The appellant is engaged in the import and trade of various

electronic products, including digital still image video cameras3. According

to the appellant, it was entitled to claim exemption from payment of basic

customs duty on the import of digital cameras in terms of a Notification

dated 01.05.2005 that was subsequently amended on 17.03.20124. The

appellant claims that the benefit of the Exemption Notification was earlier

granted to the appellant for the period from 17.03.2012 to 12.02.2014 but

as an investigation was carried out by the Directorate of Revenue

Intelligence on the imports of digital cameras, the department did not

allow the appellant to claim the benefit of the Exemption Notification from

February, 2014 onwards. When the department did not allow the appellant

to claim exemption from payment of basic customs duty in terms of the

Exemption Notification, the appellant submitted a letter requesting the

department to provisionally assess the Bills of Entry filed for importing

digital   cameras.   The   Deputy    Commissioner     wrote   a   letter   dated

14.03.2014 to the appellant stating that digital cameras were not eligible

for exemption of customs duty, but if the appellant did not agree, it could

intimate the department so that a speaking order could be passed under

section 17(5) of the Customs Act, 19625. The appellant, by a letter dated

18.03.2014, requested the officer to pass a speaking order. However, the

appellant paid basic customs duty under protest for future Bills of Entry

and filed protest letters with each of the Bills of Entry.

3.    As speaking orders were not passed, the appellant claims that it had

no choice but to file a refund application on 21.07.2015 before the

Assistant Commissioner of Customs (Refund), New Delhi6 claiming refund


3.    the digital cameras
4.    the Exemption Notification
5.    the Customs Act
6.    the Assistant Commissioner
                                                 3
                                                                                        C/52552/2019

of duty amounting to Rs. 7,32,77,496/- paid under protest for the period

from 29.12.2014 to 27.02.2015. The refund application was filed in Form

No. 102 and it also contained a covering letter. In Column No. 10 of the

said Form, the appellant stated as follows:

10.   Any    further      details    deemed     :   Department had initially allowed us
      necessary     and   relevant   to   the       to import the DSC on provisional
      refund claim                                  basis      availing      the      benefit       of
                                                    Notification          No.      25/2005-Cus.
                                                    However, on 14.03.2014 we were
                                                    informed        that     department         had
                                                    reassessed the bills of entry. We
                                                    were informed that if we do not agree
                                                    to the re-assessment, we may intimate
                                                    the same to the department in writing
                                                    so that a speaking order may be
                                                    passed as envisaged under Section
                                                    17(5)      of   the   Customs      Act,   1962.
                                                    Thereafter, we filed bills of entry
                                                    under      protest     and     asked      for    a
                                                    speaking        order.      However,       even
                                                    after       multiple        reminders,          no
                                                    speaking order has been passed till
                                                    date.       Therefore,       in     abundant
                                                    caution, we are filing the refund
                                                    claim. Covering letter is enclosed
                                                    as Appendix-2.



                                                                           (emphasis supplied)



4.    In the covering letter, the appellant stated:

                  "8. It is submitted that we are eligible to claim the
                  refund of the amount paid under protest, as the
                  cameras are entitled to the benefit of exemption from
                  payment of BCD. Brief submissions explaining such
                  eligibility of the cameras are as follows:

                  (a) to (q) *****

                  (r) In this background, we are filing the refund
                  application in abundant caution without prejudice to our
                                                4
                                                                                     C/52552/2019

              request for passing of a speaking order which has not
              been passed till date despite repeated reminders. We
              request your goodself to grant us the refund of Rs.
              7,32,77,496/- along with interest at applicable rate. An
              affidavit affirming the above facts is attached. Further,
              following     documents    are       being   submitted    in    this
              regard:-

                   Letter of payment of duty under protest
                    (Annexure-2);
                   TR-6 Challan as evidence of payment of duty
                    (Annexure-3);
                   Attested copy of the Audited balance sheet
                    showing claims recoverable (Customs duty) for
                    financial year 2014-15 (Annexure-4);
                   CA Certificate for unjust enrichment along with
                    Co-relation certificate (Annexure-5);
                   Original Copy of the bills of entry (Annexure-6).

              9.   At the time of filing of earlier refund application on
              16.03.2015,      your     goodself      pointed    out    several
              deficiencies and sought for following documents namely
              Original Bills of entry, CA certificate and Co-relation
              certificate. It is submitted that we are filing the present
              application accompanied with Original Bills of entry, CA
              certificate    along    with     Co-relation      certificate    as
              Annexures 6 and 5 respectively."


5.   A speaking order has to be passed within a period of 15 days from

the date of re-assessment of the Bills of Entry as contemplated under

section 17(5) of the Customs Act. The appellant had made a request for

passing speaking order on 18.03.2014 but as it was not passed despite

reminders submitted by the appellant, the appellant filed Writ Petition No.

8009 of 2015 before the Delhi High Court on 21.08.2015 for a direction

upon the respondent to pass a speaking order.

6.   On 15.09.2015, the Assistant Commissioner issued a memorandum

asking the appellant to explain why the refund claim should not be

rejected in the absence of re-assessed Bills of Entry in view of the

judgment of the Supreme Court in Priya Blue Industries Ltd. vs.
                                             5
                                                                               C/52552/2019

Commissioner of Customs (Preventive)7. The appellant submitted a

reply dated 30.09.2015 stating therein the appellant was entitled to the

benefit of the Exemption Notification and that re-assessed Bills of Entry

were not required to be filed for claiming the refund.

7.    Writ Petition No. 8009 of 2015 filed by the appellant before the Delhi

High Court came to be disposed of on 08.02.2016. A direction was issued

to the Deputy Commissioner to pass a speaking order under section 17(5)

of the Customs Act within fifteen days.

8.    The Assistant Commissioner, by order dated 12.02.2016, rejected

the refund application filed by the appellant on the ground of absence of

re-assessed Bills of Entry. The relevant portions of this order dated

12.02.2016 are reproduced below:

              "I have gone through the case records and examined
              the documents submitted by the party. The party filed
              refund application for excess duty paid against
              Bills of entries filed between the period December
              2014 to February 2015 on the ground that the
              party is eligible to claim the benefit of exemption
              from payment of basic customs duty provided
              under     Notification     No.    25/2005    Cus-        dated
              01.03.2005. The party imported Digital Still image
              video Cameras (DSCs) and classified the same under
              Customs    Tariff   heading   85258020     and     the   party
              claimed    the   benefit   under    Notification    25/2005-
              Customs dated 01.03.2005 as amended by Notification
              No. 15/2012 Customs dated 17.03.2012. The Deputy
              Commissioner of Customs, Group VA, New Customs
              House, New Delhi denied the benefit of exemption
              under Notification No. 25/2005 Cus dated 01.03.2005
              on the DSCs imported by the party and finalized the Bill
              of Entries in terms of Section 17(4) of the Customs Act,
              1962.

                   Further, party has filed refund claim without
              getting the said Bill of Entry re-assessed from the



7.    2004 (172) E.L.T. 145 (S.C.)
                              6
                                                                C/52552/2019

concerned assessing group or without any order
passed by the appellate authority in favour of the
party   for   eligibility    of    the   said    exemption
Notification. They submitted refund application along
with Bills of entries filed between the period December
2014 to February 2015, CA Certificate, Co-relation
sheet, Correspondence with department and requested
that refund application be allowed to be filed and be
adjudged on the merits of the case and a formal order
be passed.

     I observe that the relevant Bills of entry
were finally assessed by the concerned assessing
Group and benefit of Notification No. 25/2005
Customs dated 01.03.2005 was denied and thus
there is no excess payment, as the exemption
under     Notification       25/2005-           Cus   dated
01.03.2005 was denied to the party by the Deputy
Commissioner        of   Customs,        Group-VA,        and
therefore, if the party has any different view they
should have approached the appellate authorities
for getting orders for the re-assessment of the
said bills of entry. Accordingly, memorandum dated
15.09.15 and 07.01.2016 were issued to the party and
an opportunity for personal hearing was also granted to
the party In response to the said memorandum, the
party appeared for personal hearing on 18.01.2016 and
submitted a written submission.

     In view of the above, I find that party's
claim for refund is not justifiable and thus not
admissible    for   refund    of    excess      payment    of
customs duty under section 27 (1) (a) of the
Custom Act, 1962. Court cases and other supporting
grounds relied upon by the party do not squarely cover
the issue and without getting bills of entry re-assessed,
excess payment cannot be established.

     It is observed that the party failed to submit any
re-assessment order or speaking order under Section
17(5) of the Customs Act, 1962 from the concerned
group on classification of goods under consideration.
Further, it is beyond the scope of jurisdiction of
refund branch to decide the issue on merits
without the assessment of the said Bills of Entry
                                              7
                                                                                  C/52552/2019

             by the concerned appraising group and refund
             branch       can     only   decide    cases     where    excess
             payment is clearly established with documentary
             evidence. Hon'ble Supreme Court order in the
             case    of    M/s     Priya    Blue    Industries    Ltd.,     Vs.
             Commissioner as reported in 2004 (170) ELT A
             308 (SC) held that once an order of assessment is
             passed the duty would be payable as per that
             order. Unless that order of assessment has been
             reviewed under Section 28 and /or modified in an
             Appeal that order stands. A refund claim is not an
             appeal       proceeding.      The     officer   considering     a
             refund       claim    cannot    sit    in   Appeal      over   an
             assessment made by a competent officer. The
             officer      considering      the     refund    claim    cannot
             review an assessment order.

                    In view of the above, I find that refund claim
             of Rs. 7,32,77,496/- filed on 21.07.2015 is not
             maintainable since the importer has failed to
             fulfill the basic condition for claiming of excess
             payment of customs duty under section 27(1)(a)
             of the Customs Act, 1962. I find there is no proof for
             payment of excess custom duty in respect of Bills of
             entries filed for the period December 2014 to February
             2015. Thus the claim is not admissible and liable to be
             rejected.

                                                     (emphasis supplied)


9.    The appellant challenged the aforesaid order dated 12.02.2016

passed by the Assistant Commissioner by filing an appeal before the

Commissioner (Appeals).

10.   A speaking order was also passed by the Assistant Commissioner

after a period of almost two years on 12.05.2016. The benefit of the

Exemption Notification on import of digital cameras imported by the

appellant was denied. This order was also assailed by the appellant by

filing an appeal before the Commissioner (Appeals).
                                                 8
                                                                                       C/52552/2019

11.   The appeal filed by the appellant against the speaking order dated

12.05.2016 was dismissed by the Commissioner (Appeals) by order dated

06.06.2019 after placing reliance on the decision of the Tribunal rendered

on 19.12.2017 in the matter of the appellant wherein exemption claimed

from payment of basic customs duty on digital cameras was not accepted.

The relevant portions of the order dated 06.06.2019 passed by the

Commissioner (Appeals) are reproduced below:

             "2.1 The Appellant had filed 626 Bills of Entry during
             the period from 13th February, 2014 to 7th March, 2015
             for clearance of 'NIKON' brand "Digital Still Image Video
             Cameras" under CTH 85258020 with duty rates 0%
             +12%+0%+0%            vide    Notification       No.   25/2005-Cus
             dated    01.03.2005          (hereinafter        referred    to     as
             "Notification No. 25/2005-Cus") Sr. No. 13 as amended
             by   Notification     No.    15/2012-Cus.         However,        while
             finalizing the assessment of the impugned Bills of
             Entry, the Department assessed the duty rates as
             10%+12%+2%+1%+0%                       without     granting        the
             exemption benefit of 10% Basic Customs Duty (BCD).
             The Appellant cleared the goods on payment of
             differential duty "under protest".

             2.2 Accordingly, the Adjudicating Authority passed the
             impugned Order that 'NIKON' brand "Digital Still image
             Video Cameras" imported                by the     Importer under
             subject Bills of Entry are not entitled to BCD exemption
             as per Notification No. 25/2005-Cus as amended by
             Notification No. 15/2012-Cus as they do not fit into the
             category of "explanation" provided thereunder at SI.
             No.13.       Therefore,      the       re-assessment        by     the
             Department by denying the exemption benefit based
             upon the features and the contentions raised by the
             Importer is in accordance with the said Notifications
             and the referred Board's Circular. Held Accordingly.

             *****

             5.8 Hon'ble CESTAT, Principal Bench, New Delhi
             in   Final    Order    No.     58446-58450/2017                  dated
             19.12.2017 in the matter of M/s. Sony India Pvt.
             Ltd., M/s. Canon India Pvt. Ltd., M/s. Nikon India
                             9
                                                              C/52552/2019

Pvt. Ltd. & Others, wherein the identical issue of
the benefit of exemption of Basic Customs duty to
Digital    Still   image    Video     Cameras         under
Notification No. 25/2005- Cus., as amended on
17.03.2012, held, inter alia, that:

  "Para 22. The imported digital cameras taking into
  consideration the memory capacity at the time of
  import, were found to have the capability of
  recording video in a single sequence of more than
  30 minutes. However, during investigation, it was
  found that such capabilities have been restricted
  through firmware to a single sequence of less
  than 30 minutes. Hence, the fact of matter is that
  the imported digital cameras, can run a single
  sequence of only less than 30 minutes whereas
  the cameras have the capability to have a single
  sequence of much more than 30 minutes. If the
  arguments of the appellant are to be accepted,
  then the notification benefit is to be extended to
  all those digital still image video cameras, in
  which a single sequence recording is of less than
  30 minutes. Such an interpretation will make the
  stipulation in the explanation to the Notification
  about the maximum storage (including expanded)
  capacity as redundant. It is obligatory to read and
  satisfy all the conditions of the notification without
  rendering any part therein as redundant. Since in
  the present case, the imported digital cameras
  are capable of recording video with minimum
  resolution and minimum recording speed for more
  than 30 minutes in a single sequence; using
  maximum storage capacity, such cameras will not
  be entitled to the benefit of notification. It is well
  settled that a person who claims exemption or
  concession, has to establish that he is entitled to
  that exemption or that concession. In the present
  case, as discussed above, the impugned goods do
  not fulfil all the conditions specified in the
  notification and hence it is inevitable that the
  benefit of notification is denied to these goods."

*****

5.9 Therefore, the impugned Order is legally correct in
holding that the impugned 'Digital Still Image Video
Cameras' imported by the Appellant are not entitled to
BCD exemption as Notification No. 25/2005-Cus., as
amended.     Therefore,     re-assessment        by     the
Department by denying the exemption benefit is
in accordance with the said Notification."

                                  (emphasis supplied)
                                             10
                                                                           C/52552/2019

12.   The appeal filed by the appellant against the order dated 12.02.2016

rejecting the refund application was also dismissed by the Commissioner

(Appeals) by order dated 14.06.2019. The relevant portions of the said

order dated 14.06.2019 are reproduced below:

             "2. The facts of the case are that the appellant filed a
             refund claim of Rs. 7,32,77,496/- against the Customs
             duty paid in excess on the imported goods cleared vide
             Bills of Entry filed between the period from 29 th
             December, 2014 to 27th February, 2015 on the grounds
             that they were eligible to claim the benefit of basic
             Customs duty provided under Notification No. 25/2005-
             Cus dated 01.03.2005. The Asstt. Commissioner of
             Customs (Refund) vide the impugned order rejected the
             claim filed by the appellant on the grounds that the bills
             of entry were finally assessed by the appraising group
             and no re-assessment order or order-in-appeal were
             issued against the said bills of entry.

             5.3 Hon'ble CESTAT, Principal Bench, New Delhi
             in    Final    Order   No.    58446-58450/2017      dated
             19.12.2017 in the matter of M/s Sony India Pvt.
             Ltd., M/s Canon India Pvt. Ltd., M/s Nikon India
             Pvt. Ltd. & Others, wherein the identical issue of
             the benefit of exemption of Basic Customs duty to
             Digital       Still   image     Video     Cameras   under
             Notification No. 25/2005- Cus., as amended on
             17.03.2012, held, inter alia, that: *****

             *****

             5.4 Therefore, the impugned 'Digital Still Image
             Video Cameras' imported by the Appellant are not
             entitled to BCD exemption as per Notification No.
             25/2005-Cus.,          as     amended.     Therefore,   re-
             assessment by the Department by denying the
             exemption benefit was in accordance with the
             said Notification.

             5.5 The impugned appeal involves two issues:

             (i)   Benefit of Notification No. 25/2005-Cus.

             (ii) Consequent refund of excess duty paid by applying
             Hon'ble Delhi High Court judgement of Aman Medical
             Products and Micromax Informatics Ltd. supra.
                                           11
                                                                         C/52552/2019


                     As discussed above, on merits, the case has
               been decided by Hon'ble CESTAT and benefit of
               Notification No. 25/2005-Cus. is not admissible to
               the imports made by the Appellant. Thus, there is
               no case for any refund of excess duty paid. In the
               absence of any excess duty paid or borne by the
               Appellant, no grounds for refund arise. Thus,
               there was no need for any re-assessment of the
               finalised Bills of Entry. The ratio of judgements
               cited above can come in aid when excess duty
               paid is refundable on merits. So, this case is
               against the appellant.

               6.   In the above light, I hold that nothing exists on
               merits to say that the order per se is wrong or legally
               not tenable. I dismiss the present Appeal."

                                                (emphasis supplied)


13.   The appellant filed Customs Appeal No. 52218 of 2019 before this

Tribunal against the order dated 06.06.2019 passed by the Commissioner

(Appeals) in connection with the speaking order. The Tribunal, by an

interim order dated 08.03.2022, did not agree with the decision earlier

rendered by the Tribunal on 19.12.2017 and, therefore, referred the

matter to a Larger Bench of the Tribunal to decide the following two

issues:

      (i)    Whether the digital cameras imported by the appellant

             would be entitled to basic customs duty exemption under the

             Exemption Notification, as amended by the Notification

             dated 17.03.2012, whereby an 'Explanation' was added; and

      (ii)   Whether the Tribunal, in the Final Order dated 19.12.2017,

             has correctly interpreted the scope of 'Explanation'.


14.   The Larger Bench of the Tribunal, while answering the reference by

order dated 14.06.2024, held that the digital cameras imported by the

appellant would be entitled to exemption from payment of basic customs
                                            12
                                                                                    C/52552/2019

duty in terms of the Exemption Notification. The relevant portions of the

interim order dated 14.06.2024 passed by the Larger Bench of the

Tribunal are reproduced below:

             "34. *****. In the present case, there is no ambiguity
             in   reading     the    Explanation      of     the    Notification
             No.25/2003-Cus. dated 01.03.2005 as amended, in as
             much as, a literal interpretation of the said Explanation,
             as   discussed    above,    reveals      that    all   the     three
             parameters/functions of a digital camera should be
             cumulatively read so as to ascertain whether all the
             characteristics are above the threshold limit; in that
             event, the digital camera would not be eligible to the
             exemption from BCD under the said Notification. In the
             event any one of the parameter/characteristic is below
             the threshold limit e.g. recording time is less than 30
             minutes in a single sequence using the maximum
             storage    (including    expanded)       capacity,      then    the
             cameras would be eligible to the benefit of the said
             Notification. Also, the Revenue has never claimed that
             there is ambiguity in the said Notification. On the
             contrary, the Learned Special Counsel in the written
             submission mentioned that there is no ambiguity in the
             wordings of the Notification and it should be literally
             interpreted with in the legal frame work. The appellant
             in the present case also fairly established that their
             case falls within the four corners of the said Notification
             by adducing evidence discussed above.

             35. In view of above, it can fairly be inferred that
             the appellants are eligible to exemption from BCD
             under the said Notification 25/2005 CE dated
             1.3.2005 as amended.

             36. The reference is answered, accordingly, as
             follows:

             (i) The "digital still image video cameras" would be
                  entitled to BCD exemption under Notification No.
                  25/2005-Cus. dated 01.03.2005 as amended by
                  Notification No.15/2012 dated 17.03.2012.
             (ii) The   interpretation   of     the   Explanation      by    the
                  Division Bench of the Tribunal in Sony India
                  Pvt.'s case denying the benefit of exemption is a
                                                 13
                                                                                  C/52552/2019

                    result of incorrect interpretation of the Explanation
                    of the said Notification."

                                                       (emphasis supplied)


15.   The Division Bench of the Tribunal, on the basis of the aforesaid

answer to the reference by the Larger Bench, allowed Customs Appeal No.

52218 of 2019 on 09.09.2024 by granting the benefit of the Exemption

Notification to the digital cameras imported by the appellant. The

impugned order dated 06.06.2019 passed in connection with the speaking

order was set aside with consequential relief. The relevant portions of the

order are reproduced below:

                    "M/s. Nikon India Private Limited is aggrieved by
              the     order     dated   06.06.2019          passed    by    the
              Commissioner of Customs (Appeals) by which the
              appeal that was filed by it to assail the order dated
              13.05.2016 passed by the Assistant Commissioner of
              Customs, Group VA has been dismissed. The Assistant
              Commissioner had held that NIKON brand "digital still
              image video cameras" imported by the appellant are
              not entitled to Basic Customs Duty exemption under
              the notification dated 01.03.2005, as amended by the
              notification dated 17.03.2012.

              2. When the matter was heard by this bench, a detailed
              order dated 08.03.2024 was passed. Paragraphs 64 to
              65 of the order are reproduced below:

                "64. The view that we have taken, namely, that
                "digital still image video cameras" imported by
                the appellant would be entitled to BCD exemption
                under     the    notification    dated     01.03.2005,     as
                amended on 17.03.2012, is contrary to the view
                taken by the Division Bench of the Tribunal on
                19.12.2017 in the earlier round of proceedings
                arising out of the show cause notice dated
                09.08.2014.       65.   It      would,      therefore,     be
                appropriate        to   refer        the   matter    to   the
                President of the Tribunal for constituting a
                larger bench of the Tribunal for deciding the
                following issues:
                                            14
                                                                             C/52552/2019


                 "(i) Whether the "digital still image video
                        cameras" imported by the appellant
                        would be entitled to BCD exemption
                        under      the        notification           dated
                        01.03.2005,      as     amended         by     the
                        notification dated 17.03.2012, whereby
                        an "Explanation" was added;

                 (ii)   Whether    the   Tribunal,   in   the    decision
                        rendered   on    19.12.2017,      has   correctly
                        interpreted the scope of "Explanation"."

                                                 (emphasis supplied)

              3. The matter has since been decided by the
              larger bench of the Tribunal by an order dated
              14.06.2024. The larger bench held as follows:

                 "*****
                 35.     In view of above, it can fairly be
                 inferred that the appellants are eligible to
                 exemption from BCD under the said
                 Notification 25/2005 CE dated 1.3.2005 as
                 amended."

                                                 (emphasis supplied)

              4. The appellant would, therefore, be eligible to
              claim exemption from Basic Customs Duty under
              notification dated 01.03.2005.

              5. The impugned order dated 06.06.2019 passed
              by the Commissioner of Customs (Appeals) is,
              accordingly, set aside and the appeal is allowed
              with consequential relief."

                                                  (emphasis supplied)


16.   The Bills of Entry covered in the present appeal from 05.01.2015

upto 27.02.2015 are part of the aforesaid order dated 09.09.2024 passed

by the Tribunal covering the period from 29.12.2014 to 27.02.2015.

17.   The present appeal seeks to challenge the order dated 14.06.2019

passed by the Commissioner (Appeals) upholding the order dated

12.02.2016 passed by the Assistant Commissioner rejecting the refund

application filed by the appellant.
                                           15
                                                                                 C/52552/2019

18.     The factual position, as stated above, is summarised in the following

chart. The dates mentioned in shaded background pertain to speaking

order/availability of the Exemption Notification, while the non-shaded

background pertain to the refund application:

         Date                                     Particulars
 01.05.2005 &        Exemption Notification dated 01.05.2005 granted exemption
 17.03.2012          from payment of basic customs duty to all digital cameras. It
                     was amended on 17.03.2012.
 2012                The appellant imported digital cameras through Air Cargo
                     Complex Delhi and availed basic customs duty exemption under
                     the Exemption Notification.
                     Post amendment, the benefit was initially disputed but allowed
                     later for the period 17.3.2012 to 12.2.2014 without any dispute.
 November 2013       An investigation was initiated by the Directorate of Revenue
 (DRI                Intelligence8   regarding   the   imports   of   digital   cameras   at
 investigation)      concessional rate of duty which resulted into issuance of show
                     cause notice dated 19.08.2014 proposing to deny benefits of the
                     exemption which had been claimed at the time of import of the
                     digital cameras during the period 16.03.2012- 15.02.2014.
                     The said matter was decided by Supreme Court in Civil Appeal
                     No. 1832 of 2018 by order dated 09.03.2021. The Supreme
                     Court set aside the show cause notice on the ground of
                     jurisdiction. The said order was challenged by the department by
                     filing a Review Petition. The Supreme Court, by Final Order
                     dated 07.11.2024, remanded the matter back to the Tribunal for
                     deciding the issue on merits for the normal period of limitation.
 12.03.2014          Due to the DRI investigation, department did not allow the
                     appellant to claim benefit of exemption on the digital cameras
                     imported by it from February 2014 onwards.
                     The appellant, therefore, submitted a letter requesting the
                     department to provisionally assess the Bills of Entry filed for
                     importing digital cameras.
 14.03.2014          The Deputy Commissioner wrote a letter to the appellant
 (Benefit of the     stating:
 Exemption           (i) Digital cameras are not eligible for exemption under the
 Notification)           Exemption Notification. Therefore, the department has been
                         re-assessing the Bill of Entry under section 17(4) of the
                         Customs Act without granting the benefit of the Exemption
                         Notification.



8.      DRI
                                           16
                                                                              C/52552/2019

                     (ii) In case, the appellant does not agree with the re-
                         assessment, they may intimate the same in writing to the
                         department so that a speaking order under section 17(5) of
                         Customs Act can be passed.
18.03.2014           As the appellant did not agree with the re-assessment, it
(Request for         requested for passing of a speaking order.
speaking order)
15.03.2014 and       The appellant started paying duty under protest for future Bills
18.03.2014           of Entry and filed protest letters with the Bills of Entry. The
(Payment of duty     appellant also requested for passing speaking order in all the
under protest)       letters.
16.04.2014           Various reminder letters were filed by the appellant requesting
30.05.2014           passing of a speaking order for the imports of digital cameras
27.06.2014           wherein duty was paid under protest.
06.02.2015
08.07.2015
(Reminders for
passing speaking
order)
21.07.2015           In spite of repeated reminders when no speaking order was
(Refund              passed, and as the time limit for filing refund application was
application filed)   near to its expiry, the appellant was constrained to file refund
                     application before the Assistant Commissioner for 52 Bills of
                     Entry covering the period 29.12.2014 to 27.02.2015 for an
                     amount of ₹7,32,77,496/-.
21.08.2015           As no speaking order was passed despite multiple reminders
                     filed by the appellant, the appellant filed Writ Petition (Civil) No.
                     8009 of 2015 before the Delhi High Court seeking a direction to
                     the authorities to pass a speaking order so that an appropriate
                     action could be taken by the appellant.
15.09.2015           The Assistant Commissioner issued memorandum asking the
(Memorandum-1        appellant to explain why refund claim should not be rejected in
for refund           absence of re-assessed Bills of Entry in the light of judgment of
application)         the Supreme Court in Priya Blue.
30.09.2015           The appellant responded to the memorandum by letter dated
                     30.09.2015 stating that the appellant is entitled to benefit of the
                     Exemption Notification and that re-assessed Bills of Entry are
                     not required for claiming refund.
08.02.2016           The Writ Petition filed by the appellant was allowed by the Delhi
(Writ order)         High Court by order dated 08.02.2016. The Delhi High Court
                     directed the Deputy Commissioner to pass a speaking order
                     under section 17(5) of the Customs Act within 15 days.
12.02.2016           The Assistant Commissioner passed an order dated 12.02.2016
                                                 17
                                                                                        C/52552/2019

 (received on         rejecting the refund applications filed by the appellant on the
 03.10.2016)          ground of absence of re-assessed impugned Bills of Entry. The
 (order-in-original   Assistant   Commissioner        relied     upon    the judgment        of   the
 rejecting refund     Supreme Court in Priya Blue.
 application)         The   appellant        challenged   the    order    rejecting    the   refund
                      applications before the Commissioner (Appeals).
 09.03.2016           Despite the direction by the Delhi High Court, no speaking order
 31.03.2016           was passed within 15 days from the date of decision. The
 04.05.2016           appellant sent repeated reminders to the department requesting
 (Reminder letters    for passing of speaking order pursuant to the directions of the
 for speaking         Delhi High Court.
 order post writ
 order)
 12.05.2016           The Assistant Commissioner passed the speaking order on
 (Speaking order)     12.05.2016 denying the benefit of exemption to digital cameras
                      imported by the appellant, including imports made by impugned
                      Bills of Entry.
                      The appellant filed an appeal against the speaking order before
                      the Commissioner (Appeals).
 06.06.2019           After a delay of almost 3 years, the Commissioner (Appeals) by
 (CC(A) order for     an order dated 06.06.2019 upheld the speaking order denying
 speaking order)      the benefit of the Exemption Notification to the appellant.
 14.06.2019           The Commissioner (Appeals) passed an order dated 14.06.2019
 (Impugned order      upholding the order dated 12.02.2016 that rejected the refund
 by CC(A) for         application by relying on the decision of the Tribunal dated
 refund               19.12.2017        in   M/s.    Sony       India    Private      Limited     vs.
                                                                         9
 application)         Commissioner of Customs, New Delhi to hold that benefit of
                      the Exemption Notification is not available. Further, it was stated
                      that there is no need to decide the issue regarding requirement
                      of re-assessed Bills of Entry as the issue is already decided on
                      merits against the appellant by the Tribunal.
 05.09.2019           The appellant filed an appeal against the order dated 06.06.2019
 (Appeal against      before the Tribunal bearing Customs Appeal No. 52218 of 2019.
 OIA for speaking
 order)
 13.09.2019           The order dated 14.06.2019 has been challenged by the
 (Appeal against      appellant in the present appeal before the Tribunal.
 refund rejection
 order)
 08.03.2022           The Tribunal, by interim order dated 08.03.2022, dissented with
 (Referral order to   the findings given by the Tribunal in the earlier case of the



9.    2018 (362) E.L.T. 637 (Tri.-Del.)
                                              18
                                                                                        C/52552/2019

larger Bench for    appellant.
speaking order)     Accordingly, the issue on merits was referred to a Larger Bench
                    to decide the following two questions:
                    (i)    Whether the digital cameras imported by the appellant
                           would be entitled to basic customs duty exemption under
                           the Exemption Notification, as amended by the Notification
                           dated 17.03.2012;
                    (ii)   Whether    the     Tribunal       in   Sony    India     decided     on
                           19.12.2017,      had     correctly     interpreted     the   scope   of
                           'Explanation'?.
14.06.2024          The Larger Bench of the Tribunal by an interim order dated
(Larger Bench       14.06.2024 held that the digital cameras imported by the
order)              appellant    would   be       entitled   to benefit     of   the Exemption
                    Notification.
09.09.2024          The Tribunal, by order dated 09.09.2024, allowed the benefit of
(CESTAT order in    the Exemption Notification to the appellant following the Larger
C/52218/2019-       Bench order and set aside the order dated 06.06.2019 with
Speaking order)     consequential relief.
                    The Bills of entry covered in the present appeal are part of this
                    order of the Tribunal wherein the issue on merits has been
                    decided in favour of the appellant.
January, 2025       The department has challenged the Order dated 09.09.2024 of
                    the Tribunal in Civil Appeal No. 3541 of 2025 before the
                    Supreme Court. However, no stay has been granted and notice
                    has been issued on 24.02.2025.
09.04.2025          Post   remand    from         the   Supreme     Court    by    order    dated
                    07.11.2024, the Tribunal heard the issue on merits and relying
                    upon the order dated 09.09.2024, allowed the benefit of the
                    Exemption Notification.



19.    Shri V. Lakshmikumaran, learned counsel for the appellant assisted

by    Ms. Jyoti Pal, Ms. Anjali Gupta and Shri Ashwani Bhatia, made the

following submissions:

       (i)   The reason given by the Commissioner (Appeals) in the

             impugned order dated 14.06.2019 for rejection of refund

             claim that the issue stood concluded by a decision dated

             19.12.2017 of the Tribunal rendered in the matter of the

             appellant no longer subsists in view of the Larger Bench

             order dated 14.06.2019 of the Tribunal. Accordingly, the
                                          19
                                                                          C/52552/2019

              impugned order is liable to be set aside and the refund

              application dated 21.07.2015 is liable to be allowed for

              refund of the differential duty along with interest in terms of

              section 27 read with section 27A of the Customs Act;

      (ii)    The Larger Bench of the Tribunal decided the issue on merits

              in favor of the appellant by order dated 14.06.2024 and in

              terms of the Larger Bench order of the Tribunal, the Division

              Bench of Tribunal passed the Final Order on 09.09.2024.

              The impugned Bills of Entry for which refund has been filed

              by the appellant are covered under the order dated

              09.09.2024 of the Tribunal allowing the benefit of the

              Exemption Notification to digital cameras. Thus, the order of

              the Tribunal read with impugned Bills of Entry would

              tantamount to re-assessment of the impugned Bills of Entry.

              Therefore, once re-assessment has been done in favor of the

              appellant by order dated 09.09.2024 of the Tribunal, the

              issue raised in the order dated 12.02.2016 passed by the

              Assistant Commissioner for rejecting the refund application

              also does not survive;

      (iii)   The judgment of the Supreme Court in ITC Ltd. vs.

              Commissioner of Central Excise, Kolkata10 and other

              judgments relied upon in the order dated 12.02.2016 passed

              by the Assistant Commissioner are not applicable to the

              present case. In any case, the order passed by the Assistant

              Commissioner stood merged in the order passed by the

              Commissioner (Appeals) and only one reason has been

              given, which reason can no longer stand in view of the

              Larger Bench decision of the Tribunal;




10.   2019 (368) E.L.T. 216 (SC)
                                      20
                                                                     C/52552/2019

(iv)   The refund application filed by the appellant on 21.07.2015

       was maintainable on the date of filing as there was no legal

       bar in moving the application;

(v)    The department cannot deny refund of differential duty with

       interest to the appellant by taking advantage of its own

       delay in passing the speaking order;

(vi)   The appellant is entitled to interest from the expiry of three

       months from the date of filing of the refund application in

       terms of section 27A of the Customs Act;

(vii) The appellant is entitled to refund as a consequential relief

       to the order dated 09.09.2024 of the Tribunal. The present

       refund claim filed by the appellant is in respect of the very

       same Bills of Entry which were covered and decided in the

       speaking order dated 12.05.2016, by which the claim of the

       appellant for availing benefit of the Exemption Notification

       was initially denied. However, the Larger Bench of the

       Tribunal decided the reference in favour of the appellant and

       the Division Bench of the Tribunal passed in the order dated

       09.09.2024 in terms of the reference answered by the

       Larger Bench. A natural corollary of the above order would

       be to grant refund of the duty paid by the appellant at the

       time of filing of disputed Bills of Entry, along with necessary

       interest. This has to be regarded as consequential relief;

(viii) It is a well-settled legal position that "an appeal is in

       continuation of assessment proceedings" by virtue of which

       in case of passing of an assessment order (in this case, the

       impugned Bills of Entry read with the speaking order), the

       assessee has the statutory right to challenge it before higher

       authorities,   namely   the        Commissioner   (Appeals)   and

       subsequently the Tribunal. The appellate process is not a
                                   21
                                                                    C/52552/2019

       fresh or independent proceeding. It is treated as an

       extension of the original assessment. This principle ensures

       that the final outcome of the appellate process is deemed to

       have effect from the date of the original assessment and not

       from the date of the appellate order. It means when the

       Tribunal held that the appellant was entitled for the

       exemption, the speaking order and the subsequent order of

       the Commissioner (Appeals) stood modified and it is this

       order which survives. Therefore, as a consequential relief,

       and appeal being continuation of assessment proceedings,

       the order takes effect from the day of assessment of

       impugned Bills of Entry. It cannot be that when the Tribunal

       passed the order, the appellant became entitled to benefit of

       the Exemption Notification from that date i.e. 09.09.2024;

(ix)   The order passed by the Assistant Commissioner rejecting

       refund application has been modified by order dated

       09.09.2024 of the Tribunal;

(x)    Section 27(1B) does not restrict the assessee from filing

       refund claim prior to the date of favourable order but only

       extends the time period for doing so in case of pending

       litigation. Section 27(1B) only fixes the final date till when

       the refund claim can be filed. However, the initial date has

       not been fixed by the said provision;

(xi)   The judgment of the Supreme Court in ITC does not prevent

       or restrict any assessee from filing refund application prior

       to re-assessment of Bills of Entry but only allows grant of

       refund subject to modification of original assessment; and

(xii) By virtue of the doctrine of merger and the doctrine of

       relation back, the order dated 09.09.2024 passed by the

       Tribunal relates back to the date of passing of speaking
                                            22
                                                                           C/52552/2019

             order. Therefore, refund application filed by the appellant on

             21.07.2015 was valid on the date of filing. The appellant is

             entitled to interest from the expiry of three months from the

             date of refund application in terms of Section 27A of

             Customs Act.


20.   Shri P.R.V. Ramanan, learned special counsel assisted by Shri

Rakesh Kumar, learned authorized representative appearing for the

department made the following submissions:

      (i)    The ratio laid down by the Supreme Court in ITC and Priya

             Blue and Collector of Central Excise, Kanpur vs. Flock

             (India) Pvt. Ltd.11 is applicable in the present facts and

             circumstances. In fact, the ratio laid down in Priya Blue,

             which the Assistant Commissioner has relied to reject the

             refund application, will squarely cover the present matter;

      (ii)   The statue provides for filing for refund application under

             section 27 of the Customs Act but it does not mean the

             same is entertainable/maintainable before the assessment

             order is challenged and modified subsequently by the quasi-

             judicial authority (the proper officer). Thus, the refund

             application filed at that time did not carry any authority (no

             cause of action) in the absence of any modified order passed

             after the assessment order/assessed Bills of Entry. Thus, the

             refund application was not maintainable at that time as per

             ration laid down by the Supreme Court in ITC. The cause of

             action had not arisen to the appellant on 21.07.2015 when

             the refund application was filed and, therefore, the refund

             application   was   rightly   rejected.   In   support   of   this

             contention, learned special counsel placed reliance upon the


11.   2000 (120) E.L.T. 285 (S.C.)
                                          23
                                                                        C/52552/2019

              judgment of the Supreme Court in Dena Snuff (P) Ltd. vs.

              Commissioner of Central Excise, Chandigarh12;

      (iii)   The Tribunal, in its order dated 09.09.2024, relying on the

              Larger Bench decision of the Tribunal passed an order in

              favour of the appellant and they had the authority as per law

              to get the refund subsequent to the date of the order of the

              Tribunal on 09.09.2024 and not from the date of the refund

              application filed on 21.07.2015;

      (iv)    The department cannot be compelled to grant interest from

              the date when the application was filed as it would

              tantamount to granting refund without authority of law;

      (v)     There was no delay on the part of the department in passing

              speaking order. Even otherwise, once the Bills of Entry had

              been   assessed,    the   appellant   could   challenge   the

              assessments without waiting for a speaking order as per law

              laid down by the Supreme Court in ITC which holds that

              assessment includes self-assessment and re-assessment and

              even self-assessment order is an appealable order;

      (vi)    To say that the speaking order dated 12.05.2016 and the

              order of the Commissioner (Appeals) have merged in the

              order passed by the Tribunal on merit on 09.09.2024 is a

              misnomer because while one order dated 12.02.2016 has

              arisen out of the executive function of the Assistant

              Commissioner (lacking any quasi-judicial authority), the

              other order was passed on 12.05.2016 by the quasi-judicial

              authority as per order of the Delhi High Court. Both the

              orders have separate jurisdictions and cannot be collated by

              applying the doctrine of merger as it would destroy the




12.   2003 (157) E.L.T. 500 (SC)
                                            24
                                                                          C/52552/2019

              distinctiveness of the provisions of section 27 and section 17

              of the Customs Act;

      (vii) The doctrine of relation back cannot apply in the present

              facts and circumstances, more so when the present dispute

              is not related to grant of interest or refund but it relates to

              the question of maintainability/entertainability of the refund

              application filed by   the    appellant   without getting the

              assessment order passed by the quasi-judicial authority

              modified in appeal; and

      (viii) Even if the duty was paid under protest, the limitation of one

              year shall not apply. That means that the application of

              refund could be filed even beyond one year of the date of

              deposit. But once the assessment order is challenged, the

              said protest is vacated and the refund, if any, would be

              subject to the outcome of that challenge to the assessment

              order. In other words, the provisions of section 27(1B)(b)

              now takes guard of the proceedings to be adopted by the

              authority while granting refund. Thus, the refund can be

              available to the appellant only after the decision of the

              Tribunal on 09.09.2024 and not before that. Any refund

              allowed without applying the provisions of the section

              27(1B)(b) of the Customs Act will be bad in law.


21.   The submissions advanced by the learned counsel for the appellant

and the learned special counsel appearing for the department have been

considered.

22.   The appellant claims that it was entitled to claim exemption from

payment of basic customs duty on the import of digital cameras in terms

of the Exemption Notification, but as this was denied to the appellant, the

appellant requested the department to provisionally assess the Bills of
                                     25
                                                                 C/52552/2019

Entry. The Deputy Commissioner, however, by a letter dated 14.03.2014

informed the appellant that the digital cameras imported by the appellant

were not eligible for exemption of customs duty and if the appellant did

not agree it could intimate the department so that a speaking order could

be passed. In response to this letter, the appellant requested the

department to pass a speaking order but at the same time it paid basic

customs duty under protest for future Bills of Entry. As no speaking order

was passed, the appellant filed refund application on 21.07.2015 claiming

refund of the duty amount paid under protest from 29.12.2014 to

27.02.2015. This refund application was rejected by the Assistant

Commissioner by order dated 12.02.2016 as the Bills of Entry had not

been re-assessed. This order was challenged by the appellant before the

Commissioner (Appeals) and the appeal was dismissed by an order dated

14.06.2019. The Commissioner (Appeals) relied upon the order dated

19.12.2017 passed by the Tribunal in the matter of the appellant and two

other appellants wherein the benefit of exemption was denied. The

Commissioner (Appeals), therefore, held that the appellant was not

entitled to exemption from basic customs duty.

23.   It also needs to be noted that a speaking order was passed by the

Assistant Commissioner after two years on 12.05.2016 and the benefit of

the exemption notification was denied to the appellant. This order was also

assailed by the appellant before the Commissioner (Appeals), who by

order dated 06.06.2019, rejected the appeal after placing reliance upon

the decision of the Tribunal rendered on 19.12.2017 in the matter of the

appellant and two others wherein the claim of the appellant for exemption

from payment of basic customs duty was not accepted.
                                      26
                                                                  C/52552/2019

24.   This order of the Commissioner (Appeals) was assailed by the

appellant before this Tribunal and by an order dated 08.03.2022, a

Division Bench of the Tribunal did not agree with the earlier decision

rendered by the Tribunal on 19.12.2017 and referred the matter to a

Larger Bench of the Tribunal to decide whether the digital cameras

imported by the appellant would be entitled to exemption from basic

customs duty under the Exemption Notification.

25.   A Larger Bench of the Tribunal answered the reference by an order

dated 14.06.2024 and held that the digital cameras imported by the

appellant would be entitled to exemption from basic customs duty in terms

of the Exemption Notification. In view of the order passed by the Larger

Bench, the Division Bench of the Tribunal allowed Customs Appeal No.

52218 of 2019 filed by the appellant on 09.09.2024. The impugned order

was set aside with consequential relief to the appellant.

26.   The Bills of Entry covered under the present appeal from 05.01.2015

upto 27.02.2015 are part of the aforesaid order dated 09.09.2024 passed

by the Tribunal covering the period from 29.12.2014 to 27.02.2015.

27.   As noticed above, the Commissioner (Appeals) had decided the

appeal filed by the appellant against the rejection of the refund application

for the reason that the Tribunal, by an order dated 19.12.2017, in the

matter of the appellant, had denied exemption to the appellant from

payment of basic customs duty in terms of the Exemption Notification and,

therefore, the question of refund did not arise. This order dated

19.12.2017 no longer lays down good law as a Larger Bench of the

Tribunal, by an order dated 14.06.2024, held that digital cameras

imported by the appellant would be eligible for exemption from basic

customs duty under the Exemption Notification.
                                      27
                                                                  C/52552/2019

28.   The contention of the learned counsel for the appellant is that once

the Tribunal by order dated 09.09.2024 allowed the benefit of the

Exemption Notification to digital cameras, the order of the Tribunal read

with the impugned Bills of Entry would tantamount to re-assessment of

the Bills of Entry and, therefore, the reason assigned by the Assistant

Commissioner in the order dated 12.02.2016 for rejecting the refund

application also does not survive. Learned counsel also submitted that

once the Larger Bench of the Tribunal held that the appellant is entitled to

exemption from payment of basic customs duty and the Division Bench

allowed the appeal filed by the appellant against the order rejecting the

refund application with consequential relief, the appellant would be

entitled to refund.

29.   Learned counsel for the appellant also submitted that there was no

bar in moving the refund application on 21.07.2015 and the appellant

would be entitled to interest from the expiry of three months from the

date of filing the refund application in terms of section 27A of the Customs

Act. Learned counsel submitted that an appeal is a continuation of the

assessment proceedings and once the final order is passed by the

Appellate Authority, it shall be deemed to have effect from the date of

original assessment and not from the date of the appellate order.

According to the learned counsel for the appellant, the judgment of the

Supreme Court in ITC does not prevent or restrict any assessee from filing

refund application prior to re-assessment of the Bills of Entry but only

allows grant of refund subject to modification of the original assessment.

30.   Learned special counsel appearing for the department, however,

submitted that the appellant could not have filed the refund application on

21.07.2015 since no cause of action had arisen on that date and in this
                                         28
                                                                        C/52552/2019

connection, learned special counsel placed reliance upon the judgment of

the Supreme Court in Dena Snuff to contend that the cause of action to

the appellant to file the refund application could have arisen only after the

dispute was finally settled by the Tribunal.

31.   It would, therefore, be necessary to first examine this contention of

the learned special counsel for the department.

32.   In Dena Snuff, the appellant therein had classified the product

under sub-heading 2404 60 of the Central Excise Tariff and had continued

to pay duty till 27.09.1990 when the inspector declined to clear the

product unless duty at higher rate under tariff sub-heading 2404 50 was

paid. The appellant made payments under protest. However, in a matter

filed by another trader, the Tribunal held that the said product would be

classifiable under sub-heading 2404 60. It is on the basis of this decision

of the Tribunal that the appellant filed a refund application claiming refund

of duty which it had paid under protest. The Tribunal rejected the

application on the preliminary ground that the application for refund was

not maintainable. However, the Supreme Court on 28.08.2003 in the

matter of the appellant own case, decided that the appellant was right all

along and that the duty was leviable under tariff sub-heading 2404 60. It

is in this context that the Supreme Court in Dena Snuff observed that the

cause of action to the appellant would arise only after the dispute

regarding classification list had been settled by the Supreme Court on

28.08.2003. The observation of the Supreme Court in Dena Snuff are:

              "5. As far as the first submission is concerned, we are
              of the view that the Tribunal's appreciation of the
              relevant paragraph in Mafatlal Industries (supra) was
              correct. The "cause of action" of the appellant
              would arise only after the final dispute regarding
              the classification list had been settled by this
              Court. That was done as recently as on 28-8-
                                         29
                                                                        C/52552/2019

              2003. The application for refund by the appellant
              was   therefore   premature.    We   have   noted   the
              proviso to sub-section (1) of Section 11(B) which says
              that the period of limitation of one year prescribed
              under sub-section (1) will not apply in case duties are
              paid under protest. The question then is from which
              date will the period of limitation start to run? It
              appears on the basis of the paragraph of Mafatlal
              Industries decision which has been relied upon by
              the Tribunal it would have to be from the final
              decision in the assessee's own case."

                                              (emphasis supplied)


33.   The facts of the present case are almost similar to the facts of the

case before the Supreme Court in Dena Snuff. The issue is as to whether

the appellant could have filed refund claim even before the issue as

whether the appellant could claim exemption from payment of basic

customs duty was settled by the Tribunal on 14.06.2024 when the Larger

Bench of the Tribunal answered the reference. In terms of the judgment of

the Supreme Court in Dena Snuff, the cause of action had not arisen to

the appellant when the refund application was filed as the appellant had

filed the refund application on 21.07.2015. The refund application was,

therefore, liable to be rejected for this reason.

35.   Learned counsel for the appellant, however, submitted that if this

view is accepted, then the department cannot also issue protective

demand notices under section 28 of the Customs Act. Learned counsel,

therefore, submitted that if protective notices are held to be valid, then

the present refund application filed by the appellant should also be held to

be a valid application.

36.   Section 28 of the Customs Act deals with recovery of duties not

levied or not paid or short-levied or short-paid or erroneously refunded. To

issue a show cause notice under section 28 to recover duty not levied, not
                                       30
                                                                  C/52552/2019

paid, short levied, short paid or erroneously refunded, the cause of action

must have two elements- (a) the fact that duty was paid or refunded and

(b) in the opinion of the proper officer issuing the notice more duty should

have been paid or levied or that duty has been refunded erroneously. It is

usually the practice of the department to keep issuing 'show cause notices

for subsequent periods or subsequent clearances' under section 28 of the

Customs Act contrary to the decisions holding the field at that time and,

therefore, without a cause of action in the hope of succeeding in appeal.

These, so called 'protective demands', i.e., show cause notices issued

without cause of action will be equally covered by the judgment of the

Supreme Court in Dena Snuff and even if the cause of action arises

subsequently, the show cause notice cannot be issued at a time when

there was no cause of action.

37.    In view of the aforesaid discussion, the refund application filed by

the appellant was rightly rejected by the Commissioner (Appeals). This

appeal would, therefore, have to be dismissed and is dismissed.



                       (Order pronounced on 06.04.2026)




                                                  (JUSTICE DILIP GUPTA)
                                                                PRESIDENT




                                                          (P.V. SUBBA RAO)
                                                      MEMBER (TECHNICAL)
  Shreya
                                               31
                                                                     C/52552/2019

    CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
                                       NEW DELHI

                           PRINCIPAL BENCH - COURT NO. I

                    CUSTOMS APPEAL NO. 52552 OF 2019

(Arising out of Order-in-Appeal No. CC (A)/CUS/D-I/Import/NCH/255/2019-20 dated
14.06.2019 passed by the Commissioner of Customs (Appeals), New Customs House,
Near I.G.I. Airport, New Delhi)

Nikon India Private Ltd.                                      .....Appellant
Plot No. 71, Sector-32, Institutional Area,
Gurgaon - 122001, Haryana

                                          VERSUS


Commissioner of Customs (Import),                              .....Respondent
New Customs House, Near I.G.I. Airport,
New Delhi - 110037

APPEARANCE:

Shri V. Lakshmikumaran, Ms. Anjali Gupta and Shri Ashwani Bhatia, Advocates
for Appellant
Shri P.R.V. Ramanan, Special Counsel and Shri Rakesh Kumar, Authorized
Representative appearing for the Department

CORAM:
HON'BLE MS. BINU TAMTA, MEMBER (JUDICIAL)
HON'BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)


                                                   Date of Hearing: 18.11.2025
                                                   Date of Decision: 06.04.2026

                                         ORDER

Order pronounced.

(BINU TAMTA) MEMBER (JUDICIAL) (P.V. SUBBA RAO) MEMBER (TECHNICAL) Shreya